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Check Your Checking

Once again, thank you to Jennifer Savage for a well written, well reasoned, informative letter about managing one’s money (“Insolvency Resolved,” Dec. 24). In my opinion her work should be shared with every high school student in Humboldt County who is about to step out into the world of personal finance, and the personal responsibility that goes with it.

I’d like to add one detail that she didn’t cover in her latest column. As is often the case, some of the issues tripping up consumers today, especially younger ones, aren’t solely the result of poor education, poor choices or bad luck — there are actually forces conspiring against them! Ask any banker you know well how in the world Totally Free Checking! works. After all, how can any bank afford to give away today’s feature-laden checking accounts for free, and after a few pints they will let you in on one of the banker’s many secrets: Totally Free Checking! is anything but.

The customers who tend to be attracted by those giant orange signs in front of bank branches also tend to be the individuals Ms. Savage is often addressing in her columns, namely those who find themselves in financial predicaments that lead to things like NSF charges and overdraft fees. Free checking accounts can be somewhat risky but highly lucrative accounts for banks precisely because they attract customers who don’t always make careful choices about how to manage their money. These customers pay significant fees on their free checking accounts as a result.

Bankers hold this type of information and use it to their advantage, as it should be in a market-based economy. With Ms. Savage’s help, Humboldt’s consumers increasingly do too.